We cannot afford to leave behind the losers of globalisation
By Zac Tate
- What can we offer the losers of globalisation?
- By 2020, the world will have up to 95 million more low-skilled workers than employers will need
- We should welcome the role of a sensible minimum wage to ensure that the many can have a stake in a capitalist society.
Markets have been with us since the dawn of civilisation. The Neolithic Revolution, in 9500 BC when the Natufians settled down in the Levant and started cultivating teosinte, the ancestor of maize, really marks the start of market societies – involving specialisation, trade and technology.
Yet the capitalism with which we are familiar – of hyper-mobile labour and capital; and of sprawling footloose multinational companies– is a very modern innovation. The size of the global economy has more than doubled since the start of this century, from $32trn to $78trn last year, yet this new era of globalisation has created a class of losers in developed countries who increasingly look to populist parties for protection. How can they be won back?
One of the enduring strengths of the market system is its resilience and its ability to adapt. As Victoria Bateman wrote in her piece for CapX last week, there is nothing pre-ordained about the system we live within today.Markets are contingent on the design of the institutions behind them, and we have the social, cultural and political tools to shape them to meet the ends that we, as democratic societies, seek. But these tools must be used wisely.
A study last year by Pew Research revealed that about two-thirds of people around the world recognise the benefits of living within a free-market economy, but there is far more optimism in the developing world as they catch-up with the West.
Read more: www.capx.co/